This plan is all there is

Killing Labour's proposed tuition scheme could turn a crisis into a disaster, warns Chris Patten

The debate about student tuition fees has blotted out discussion of where our higher education system is heading, how competitive it is internationally, what its purpose should be, and how good it is. We shall have to come back to these issues, but in the meantime, what more can be said about the government's modest proposals for throwing a frayed financial lifeline to our universities?

First, higher education in Britain has been underfunded for more than two decades. The relentless squeeze was tightened by the Thatcher government in the 1980s and only recently, and slightly, relaxed. We have paid for its expansion by reducing spending on each student. Compared with other rich countries, our spending performance is lamentable. Universities have survived by increasing what is euphemistically called their productivity.

The result has been better managed resources, but also declining pay, dilapidated facilities, reductions in supporting services and a growing gap in research and development investment between the UK and the US.

Is the funding shortfall likely to be met by increased general taxation? Dream on. Even if Tony Blair and Gordon Brown were to abandon their consensus with the Conservative Party on direct tax, would it really be egalitarian to spend the proceeds on universities rather than schools? We need much higher amounts of public spending on universities just to compete with US levels. We should keep arguing for this, but if you favour salvation by this route, I strongly advise you not to hold your breath.

Second, the expansion of higher education is a "good" in itself. But there is no mechanistic relationship between the expansion of access and enrolment and subsequent rates of national economic growth, although it is naturally better to have a well-educated workforce than a badly educated one. I would prefer schools to drive the access argument by raising their standards rather than universities being harried to make up for the poverty of expectations in too many of our schools.

Third, there is absolutely no evidence that the expansion of free higher education has promoted social inclusion. Six per cent of my age group attended university when I was a student in the 1960s. The same proportion of university places in today's sevenfold expanded system is taken up by students from middle-class backgrounds as it was then. Free higher education helps the better-off. Where is the social justice in defending the right of parents, many of whom have been prepared to pay a small fortune to try to ensure that their children get to universities, to enjoy a free ride for their offspring at precisely the point post-18 when there is the greatest connection between educational achievement and subsequent earning power?

Fourth, if there are to be fees, how can it possibly be fair for them not to recognise that universities differ in function, cost and quality? How could it be right to oblige students to pay the same fee regardless of the quality of what they receive and the likely impact on their subsequent earnings?

Of course, we have to put more money into bursaries for poor students, raise maintenance grants for them and encourage university outreach into schools where staying-on rates are pitiful and educational aspirations are too often stunted. But we should not delude ourselves that the disadvantaged benefit from attacking the standards that the best universities struggle to achieve and maintain.

The government scheme is far from perfect. Interference in university access policies is an offensive sop to those unlikely to be bought off, and the modest sums that will eventually be on offer will not bail out Britain's higher education system. Yet this is all that is on the table. To oppose the scheme would risk turning a running crisis into an early disaster.

I hope the Conservative opposition will think again about its hostility to the scheme, or that at least its whips will turn a sensibly blind eye to those MPs still able to discern the relationship between principle and political common sense.

Conservatives should welcome anything that reduces universities' dependence on the state and that introduces - as we used to advocate - modest and fair use of a market mechanism to fund higher education. Shadow education secretary Tim Yeo has hinted at a rethink of the present policy, which opinion polls suggest rather unfortunately combines populism with lack of popularity. I hope that some, if not all, Conservatives will have their rethink before the second reading of the bill.

Chris Patten is chancellor of Oxford and Newcastle universities and external relations commissioner at the European Commission.